Canadian Dairy Commission Act

Bill to Amend--Third Reading

May 15, 2020

The Hon. the Speaker

Honourable senators, when shall this bill be read the third time?

Hon. Robert Black

Honourable senators, with leave of the Senate and notwithstanding rule 5-5(b), I move that the bill be read the third time now.

The Hon. the Speaker

Is leave granted, honourable senators?

Hon. Senators: Agreed.

Senator R. Black

Good afternoon, honourable colleagues. I am pleased to see you are all in good health.

Honourable senators, I rise today at third reading of Bill C-16, An Act to amend the Canadian Dairy Commission Act. As honourable senators are aware, this measure was announced on May 5, along with other measures to assist Canada’s farmers and food processors who are facing severe pressures brought on by COVID-19.

The other support included $77 million to help food processors purchase personal protective equipment and enact other health and safety measures, $125 million for beef and pork producers to adapt to market changes, and a $50 million surplus food purchase program.

Of these measures, the credit increase for the Canadian Dairy Commission is the only one that requires legislation to be enacted, so as much as I would love to talk about the entire suite of supports for the agricultural industry, I will limit my remarks to this specific measure.

Bill C-16 aims to address the dairy sector’s most urgent needs and to bring much-needed assistance to our dairy farmers. They are essential to our food supply, and they deserve our full support.

One of the major challenges the farming industry is facing right now is the volatile demand for their products. When the crisis first hit, consumers began panic buying and grocery store shelves quickly emptied. Within a matter of weeks and once kitchen fridges were full, demand then plummeted.

Dairy farmers were severely impacted. Demand for their milk and milk products nosedived following the mass closures of restaurants, hotels and schools. These buyers had been significant purchasers of their cream, cheese and other dairy products.

As well, beyond the farm gate, logistical challenges right down the supply chain developed. By the end of March and the first half of April, after schools sent students home, restaurants had closed their doors and hotels emptied, dairy producers found they now had no choice but to dispose of surplus raw milk.

Honourable colleagues, as you might imagine, it breaks a dairy farmer’s heart — and I am sure many Canadians’ hearts as well — to dump the milk that they have worked so hard to produce, spending long hours in the barns and in the fields. Many of these farms have been in families for generations. The farm is not only their livelihood, it is their home and it is their lives. Across Canada, farmers have done everything they can to find a home for the milk and milk products.

Farmers are giving back. In Quebec, producers donated one million litres of milk to food banks. In Saskatchewan, dairy producers donated products made from 175,000 litres of milk to food banks across the province, enough for 38,000 pounds of cheese, yogurt and milk. In Newfoundland, two dairy farmers joined forces with a local distributor to give away milk at a drive-through in a local arena parking lot. On Prince Edward Island, farmers gave away blocks of cheese and cartons of milk. In Ontario, dairy farmers contributed an additional 200,000 litres of milk to food banks across this province. As I said, farmers are giving back.

To all those farmers and others who took the opportunity to help others during this time of crisis, even while you may have been worried about your own livelihood, on behalf of many, thank you.

Additionally, provincial milk marketing boards implemented measures to reduce raw milk production and prevent the dumping of milk through a reduction of monthly credit days and quota cuts.

Honourable senators, the challenge of a changing demand is not new to the Canadian dairy industry. In fact, one of the major reasons that supply management was implemented 50 years ago was to stabilize the volatile demand and surpluses that were wreaking havoc on dairy farmers’ incomes.

Over the years, the industry has succeeded in stabilizing markets, thanks in large part to the great work of the Canadian Dairy Commission. The CDC plays an important role in stabilizing dairy production by setting a national quota and, just as importantly, balancing seasonal supply and demand through a suite of programs.

In periods of lower demand and high production, as has happened in April and May, the CDC purchases butter from dairy processors and then they sell it back when demand improves. To operate these programs, the CDC borrows from the government, with borrowing costs covered by the dairy producers and the marketplace.

The Canadian Dairy Commission Act currently limits the CDC’s line of credit to $300 million. The bill before us proposes to raise that limit to $500 million. I have already outlined the severe impact that wide swings and demand have on our producers, but the current crisis was unforeseen. Three months ago, neither the CDC nor farmers could have planned for the shutdown of their mass purchasers.

In order to help restore stability in the marketplace, the CDC — after discussion with and support from dairy producers, processors and provincial milk marketing boards — made a request to the Minister of Agriculture to increase its line of credit, to extend existing programs, and create new ones, such as the storing of cheese. This increase in funds will augment its storage programs and capacity, and help the industry balance supply-and-demand variations. It will allow the CDC to purchase cheese from processors — similar to its existing program for butter — and the processors, by contractual agreement, can then buy back that cheese when it is needed in the marketplace.

This credit extension will give the industry some breathing room until the crisis has eased and will equip the CDC with the means to manage future crises. It will minimize food waste and it will ensure that we can enjoy the fruits of our dairy farmers’ hard work.

I will note that another piece of legislation would be required to return the credit limit back to $300 million. However, the Minister of Finance annually approves the CDC’s budget, which includes its borrowing capacity. The legislation provides for a maximum limit, but would not automatically grant borrowing access to all $500 million.

Dairy Farmers of Canada has welcomed this announcement, saying it will help offset the impact of bottlenecks in the supply chain that have prevented the smooth operation of our dairy value chain. It will allow milk products to get from the farm to the store shelves, schools, restaurants and hotels quickly, when demand increases. This bill is delivering for our dairy industry in their time of need.

As dairy farmers will tell you and as we heard earlier today, a dairy cow is not like a kitchen tap; you can’t turn her off. Canadian dairy is an industry that gives so much back to our economy — over $6 billion in sales at the farm gate, almost $15 billion in processor sales and the provision of tens of thousands of jobs. I am supporting this bill in order to underscore my strong support for our dairy farmers.

Honourable colleagues, many measures are being taken to assist individuals and businesses during this unprecedented time. Bill C-16 is targeted to help dairy farmers and dairy processors. As I said, it will increase the CDC’s borrowing capacity to $500 million and provide a safety net for our dairy farmers, until such time as they can return to providing their products to the customers who are currently not in a position to purchase them.

Honourable senators, I ask you to pass Bill C-16 without delay, so that our dairy farmers can be assured of assistance while we all wait out this crisis and eventually return to, what will inevitably be, a new normal.

I said at the beginning that I would limit my remarks to the legislation before us, related to the Canadian Dairy Commission, and not other measures announced for agriculture and ongoing issues in the industry. However, I do want to say that while I’m pleased that the government is helping Canadian agriculture, much more needs to be done. Dairy, pork and beef are getting some help, but other sectors that are struggling, notably grains and oilseeds, as well as horticulture and many others, were not helped by the May 5 announcement. I am happy to sponsor and vote in favour of this bill, recognizing that it is only a small part of the support needed by the Canadian agricultural industry.

At the end of my speech on Bill C-15 on May 1, I said that I hoped we would be back in this chamber in short order to pass legislation to support agriculture. Well, here we are. But I have to reiterate my wish and say that I hope we will be back again very soon to debate more legislation to help all Canadian farmers and processors.

Thank you, meegwetch.

Hon. Claude Carignan

Dear colleagues, I am pleased to announce that the official opposition will support this bill.

This measure is a small step in the right direction, but at least it is something. I remind you that last week the Trudeau government announced support for agriculture that represents only 10% of what the Canadian Federation of Agriculture had called for. It is better than nothing, but obviously much more must be done.

In recent weeks, producers and agricultural processors have been deemed to be essential workers, those guardian angels that ensure our safety and well-being. I want to take this opportunity to thank all workers on the front lines, those working in health, emergency preparedness, transportation and retail, who have ensured that we lack for nothing, that we are safe and that those who are ill are well cared for.

The COVID-19 crisis has made us realize that thousands of people often work in the shadows, in conditions that are sometimes difficult, but always with dedication and courage, seeking to make our lives easier. When the crisis is over and we return to our routines, we must not forget these unsung heroes.

Bill C-16, and the visit from the Minister of Agriculture give us an opportunity today to reflect on the fate of our farmers. It’s time to bring agriculture issues, which are too often ignored, to the forefront. I want to take this opportunity to share some facts we must consider as we reflect on the future of our farmers.

Fact No. 1: Farmers are business owners. First of all, we can never forget that farmers are SME owners, and they handle all the challenges associated with SMEs. Agriculture became a bona fide business quite a while ago. City dwellers tend to have a bucolic and romantic idea of farm work, but anyone who knows these farmers knows that they are first and foremost business owners who are running large, complex operations. Farmers own hundreds of thousands of dollars, or even millions of dollars, in assets, but they also have to juggle the associated debt. Farmers are often employers, and that includes challenges associated with hiring, managing, paying and retaining staff. Farmers have to keep the books, deal with paperwork, purchase materials and make sales. They have to keep track of the markets, innovations and cash flow, and they have to all of the work that comes with that. Farmers need to know about agronomics, biology, mechanics, meteorology and engineering. They must manage weather fluctuations and the diseases that affect animals and plants. They have to fight with and against Mother Nature. Lastly, farmers have to deal with payroll and taxes, which can sometimes weigh heavily on a business’s finances.

Most farms are family farms. Property transfers and payments to spouses and other family members are very important issues for farmers. It is high time we came up with some solutions to reduce our farmers’ tax burden. We also need to cut back on regulations and paperwork. Farmers shouldn’t have to spend more and more time filling out forms and less and less time looking after their livestock and their fields.

The new COVID-19 programs for businesses are perfect examples of what I’m talking about. Many farmers aren’t covered by the Trudeau government’s programs because of their corporate structure or how they handle wages and dividends. As is too often the case, programs cooked up in Ottawa offices aren’t compatible with the reality on the ground. The government should have thought of farmers before creating these programs, not after. Apparently, farmers were just an afterthought.

Fact No. 2: Farmers can no longer be used as bargaining chips in trade agreements and international conflicts. It is beyond time for this game to end.

After concluding the free trade agreement with the European Union and the agreement for the Trans-Pacific Partnership, the government had to make other concessions to sign a deal with Mexico and the United States. Adding insult to injury, the government’s decision to ratify the agreement before May 1 will cost dairy processors over $100 million.

Obviously, it is critical that producers and processors be adequately compensated for the agreements signed recently. However, the Canadian agricultural community cannot grow on the basis of compensation received for lost market shares.

Despite all the lofty promises from politicians, farmers are worried. Will they be at risk in future trade deals with the United Kingdom and Mercosur? Will they once again be hit with a nasty surprise at the last minute?

The federal government must be clear. Canadian agriculture can no longer be used as a pawn in trade negotiations.

What’s more, farmers often pay the price of trade wars and other diplomatic conflicts. Take for example China’s decisions regarding canola and pork, India’s decisions regarding pulse, and the United States’ decisions regarding beef, lamb and softwood lumber. All too often farmers pay the price for diplomatic manoeuvring that has nothing to do with them.

We should no longer allow our trade partners to act in bad faith by using non-tariff barriers to refuse or delay the entry of Canadian agricultural products. We must be more aggressive in defending the rights of our exporters. In Canada, the rules must be the same for imported and domestic products. We must expect the same high standards from imports as we do from our own local products. We therefore cannot help but be disappointed by Minister Bibeau’s refusal to accept the principle of reciprocity in the enforcement of food product regulations.

Fact No. 3: Farmers need workers and someone to take over. The current crisis made it clear that our farms don’t have enough workers.

Many farmers have to call upon temporary foreign workers, but there’s a lot of red tape involved. Sometimes, as with the current pandemic, events occur that prevent them from hiring all the workers they need. In any case, the temporary foreign worker program doesn’t meet long-term needs since farmers need to start over every year.

The foreign worker program needs to be reviewed. We must no longer treat the use of these workers as a temporary solution. The current crisis is making it clear that these workers are part of the long-term solution.

Work permits should last more than one season and the temporary workers should have a path to permanent residence. An increased number of economic immigrants need to be selected to work in the agriculture sector.

Producers are also concerned about succession planning, more specifically about transferring their farm to their children. We have to encourage young people to choose farming as a future profession. The federal government has a role to play in that.

The issue of taxing business transfers is complex, like everything that has to do with the Income Tax Act, but we have to look at ways to not penalize those who want to transfer their business to their descendants instead of third parties.

Fact No. 4: We have to make changes to the risk management programs.

The various risk management programs no longer reflect the current realities of the agriculture sector. We have to review them, including by taking into account the political risks. Many of the problems farm operators are experiencing can be traced back to political decisions, as I was saying earlier. The aid programs have to be adapted.

We also need to realize that there can’t be a one-size-fits-all program anymore. Every agricultural sector has its own specific characteristics. The production risks and methods of compensation are not the same for chicken farming as for mushroom farming.

Fact No. 5: Farmers need to be involved in the fight against climate change.

The federal carbon tax introduced by the Liberals won’t have any impact on climate change. All this tax does is raise the cost of living for Canadians and make our farmers less competitive.

Farmers are the best stewards of our land. Canada’s farmers have sequestered millions of tonnes of CO2 by improving their land use practices, such as no-till seeding. We should recognize their contribution to carbon sequestration instead of imposing additional costs on them, like the carbon tax.

Fact No. 6: Farmers are grappling with mental health challenges.

Statistics show that farmers are increasingly struggling with mental illness and may suffer from substance abuse, depression or suicidal thoughts.

These problems can be attributed to the stress inherent to running an SME, but also to factors specific to agriculture. In addition, farmers often live alone, leaving them vulnerable to crime as well as loneliness.

We must improve access to specialized resources and get behind projects that will help producers. For example, I believe Quebec’s outreach worker program is one solution we must prioritize.

The federal government must say it loud and clear: Our farmers are neither criminals nor torturers. We must defend them against the vicious attacks of activists. Farmers must feel safe on their farms.

Fact No. 7: Agriculture must be restored to its rightful place in Canada.

The role of the Minister of Agriculture must be restored to one of prominence. Canadians are proud of their agricultural sector, but the industry is practically no longer being heard in Ottawa. The Minister of Agriculture is now a minor player. All too often, decisions about agriculture are left up to public servants and politicians who have little knowledge of or consideration for the agricultural sector.

Decisions about agricultural regulations, labelling rules or the content of the food guide, for example, must be made based on science and fairness towards our producers. The government must rely on studies and not simply on perceptions spread by anti-farmer lobbies.

Fact No. 8: Agricultural producers are the backbone of rural areas and do not want to be second-class citizens.

Rural regions have been ignored for years. We need to make sure that the regions receive their fair share of infrastructure money. Announcements about public transit and social housing are all well and good, but in case some have forgotten, not everyone lives in a big city. We need to make sure that cabinet decisions and government programs reflect a rural perspective.

We need to make sure that people who live in rural regions have access to high-speed Internet, because it’s 2020 on farms too.

Dear colleagues, I wanted to share these thoughts with you. We take our food security for granted far too often. We tend to forget that milk doesn’t come from a store, but that there are thousands of families that work hard to keep our fridges and cupboards full.

We need to listen to our farmers, and not just about what directly affects agriculture, but also about issues as diverse as management and taxation of SMEs, climate action and the challenges of rural life.

As a final point, I also want to acknowledge the contribution made by workers in the food processing industry. They often work in difficult conditions and for low wages. On top of that, meat processing plants have been hit especially hard by the COVID-19 epidemic. To all the men and women working in the agriculture industry and the production and processing sectors, I want to say thank you. Thank you for everything you’re doing at this time.

Lastly, to you, honourable colleagues, I say this: Let’s not forget them once this crisis is over.

Thank you.

Hon. Mary Coyle

Honourable senators, hopefully, after today, we will all be able to stop crying over spilled milk. The 30 million litres of spilled Canadian milk we were upset about were dumped due to the COVID-19 pandemic and the related problems in balancing supply and demand in our dairy sector.

Today, the Senate of Canada is sitting to consider Bill C-16, An Act to amend the Canadian Dairy Commission Act, so that Canada’s dairy farmers won’t need to spill any more milk and so that they and all Canadians can stop shedding our tears over this terrible and regrettable travesty.

The Canadian dairy industry, as we’ve heard from our colleague Senator Rob Black, is very important to our food security and nutritional status as well as being a significant contributor to our economy, especially in rural Canada, as my colleague Senator Carignan has just pointed out.

In Canada, we have over 10,000 dairy farms with 1.4 million dairy cows. There are 514 dairy processors, and the dairy sector sustains approximately 220,000 full-time equivalent jobs for Canadians. The sector contributes $20 billion toward Canada’s GDP and $3.8 billion in annual tax revenue. This is significant.

Before this recent COVID-related spilled-milk crisis, this vital Canadian dairy sector was already undergoing another crisis brought on as a result of three recent international trade agreements — CETA with Europe; CPTPP, in the Trans-Pacific region; and the recent CUSMA with the U.S. and Mexico. At full implementation of these agreements, market access granted to others will represent 18% of the Canadian market, resulting in Canadian dairy producers losing $328 million annually; $154 million of that is due to CUSMA alone.

In addition to the market access concessions, CUSMA imposes export market caps on worldwide shipments — not just those to the U.S., by the way — of certain Canadian dairy products. With CUSMA coming into effect July 1 rather than August 1 of this year, the negative impact will be greater and accelerate faster. These export market caps will ultimately result in significant annual losses for dairy producers as well.

So to be clear, we are here today to examine a measure designed to respond to the negative impacts of the COVID crisis on a sector which is already feeling bruised. The three previous emergency response bills that we considered here were designed to address the needs of those Canadians left vulnerable due to the negative impacts of the COVID pandemic. The first created income support payments, the CERB, for people who could no longer work due to COVID. The second created wage subsidies, the CEWS, for businesses and non-profits that had lost significant income due to COVID so they could pay their workers and keep them ready to recommence work. The third COVID emergency response bill, the CESB, will provide income support for students who can’t find work this summer. Applications for that program are being received as of today.

Due to the COVID pandemic, we are discovering, taking note of and trying to address vulnerabilities across many aspects of our Canadian society and our economy.

Since the creation of the Canadian Dairy Commission and the introduction of the supply management system by the Canadian dairy sector in the 1970s, this has been a very reliably managed sector for both the producers and for us consumers. However, with COVID, this well-oiled machine has developed vulnerabilities we would have never expected. With the COVID pandemic, one of the main public health measures has been social distancing, which, in turn, led to the shutdown of the restaurant sector as well as many other institutions such as schools and universities.

That shutdown resulted in reduced demand for dairy products, including cheese and cream, thus causing the bottlenecks in the supply chain that led to the unfortunate dumping — the spilling — of that milk.

The Canadian Dairy Commission is a Canadian Crown corporation. Its objectives are to provide producers of milk and cream with the opportunity to obtain a fair return for their labour and investment and to provide consumers with a continuous and adequate supply of high-quality dairy products.

The CDC is therefore well placed to assist the dairy sector with its COVID-related oversupply problems. Bill C-16 is in fact a response to a request by the dairy sector to have the CDC augment its purchase and storage programs in order to help the industry balance supply and demand variations which were no longer predictable due to the COVID-19-related impacts on consumer behaviour.

In essence, Bill C-16 amends the Canadian Dairy Commission Act and increases its borrowing capacity by $200 million to $500 million. The CDC, in turn, will be able to purchase and store more cheese and butter from dairy processors which they can then buy back later when market demand warrants it.

This measure, which will provide the CDC with sufficient borrowing capacity now and well into the future, provides relief to dairy producers and processors and reduces further waste — hopefully, no more spilled milk.

Colleagues, this is very good news for the sector and for all Canadians. Fortunately, the dairy farmers themselves have generously found a way to donate some of their surplus milk to food banks. Hopefully the government’s recently announced $50 million surplus food purchase program, part of the $252 million initial funding package for the agricultural and food sector, might allow for purchase and redistribution of any further excess milk.

I live in a very rural area of northeastern Nova Scotia, where we have many well-run dairy operations. Some are run by Dutch families who came to our area after the Second World War. When studying this bill, we reached out to Chris van den Heuvel, an Inverness County dairy farmer, past president of Nova Scotia Federation of Agriculture, and currently second vice-president of the Canadian Federation of Agriculture.

Chris van den Heuvel told us that, “These are trying times. Within dairy we’ve been hit despite our supply management system. The loss of the food services side of the sector has meant the dumping of upwards of 1 million litres of milk a week. With two monthly declines in our quota — which means less milk to ship — it, of course, limits our income. All of this has added to the mental health stress of our dairy farmers who are already in an industry with razor-thin margins. Added to this is an animal welfare issue with farmers having to make decisions to either dry cows off early or cull them all together. Not a good situation all around, but keep in mind that other sectors — horticulture, beef, pork, chicken, equine, seafood farming, mushrooms and ornamentals, to name a few — are hurting just as bad.”

Brian Cameron, general manager of Dairy Farmers of Nova Scotia, responded to our communications by saying, “Dairy farmers welcomed the announcement of the federal support for the agriculture sector. Dairy farmers across the country are working hard to help feed Canadians in a time of great uncertainty, and we welcome measures that will stabilize our sector. The large quota reductions in April and May, at a time when milk production typically increases, directly reduce cashflow at an expensive time of the year with spring field preparation and planting happening.”

Brian added that, “I believe, in speaking with many producers, that the tragic events earlier in April here in Nova Scotia, along with the social distancing and other restrictions, are taking their toll mentally as well as socially.” The bad news that the government gave away the August 1 CUSMA start date further harms dairy farmers. We’ve been let down too many times.

Despite these setbacks, Brian says “our producers are strong and resilient and will produce high-quality milk.”

Colleagues, Canadian dairy farmers may be strong and resilient, as Mr. Cameron described them, but I know that it broke their hearts and their spirits for them to have to dispose of the precious milk that they and their cows worked so hard to produce. Colleagues, let’s not let these farmers down. Let’s pass Bill C-16, and let’s all think of these hard-working dairy farmers when we enjoy our milkshakes, our Frappuccinos and our ice cream cones with our families this summer. Wela’lioq. Thank you.

Hon. Donald Neil Plett (Leader of the Opposition)

Honourable senators, it was March 11 when the World Health Organization declared the coronavirus outbreak a global pandemic. In his remarks to the media that day, the WHO’s director said the following:

In the past two weeks, the number of cases of COVID-19 outside China has increased 13-fold, and the number of affected countries has tripled.

There are now more than 118,000 cases in 114 countries, and 4,291 people have lost their lives.

Thousands more are fighting for their lives in hospitals.

In the days and weeks ahead, we expect to see the number of cases, the number of deaths, and the number of affected countries climb even higher.

Colleagues, as we know, this is exactly what happened. March 11 was nine weeks ago on Wednesday. Nine weeks ago, there were 118,000 cases of COVID-19. Today, there have been more than 4.5 million cases worldwide.

Nine weeks ago, 4,291 people had lost their lives from this virus. The global COVID-19 mortality rate was 3.6%. Today, the virus has claimed the lives of over 300,000 people in 177 countries, and the mortality rate is at 6.7%. In Canada, our mortality rate is even higher, at 7.5%. Over 73,000 Canadians have tested positive for the virus, and over 5,400 have lost their lives.

That’s over 5,400 families and untold loved ones who have been directly impacted by the untimely loss of a family member or a friend due to this virus. These were moms and dads, brothers and sisters, grandmothers and grandfathers who only weeks ago sat together for dinner or visited in a seniors’ home amidst love and laughter, and now they are gone. The pain caused by this virus is incalculable, and our hearts and our prayers go out to everyone who has been impacted.

Colleagues, many of you may not know that one of our own was impacted just two days ago when she lost her father to this. Senator Saint-Germain, our prayers are with you.

She could FaceTime with her father during his last time. Regrettably, nothing will wind the clock back to the way things used to be. Nothing can restore what has been lost. It’s not like a video game where you can just restart in order to replay the level. This is real life, and real life is full of joys and sorrows, some avoidable and some unavoidable. This is the great tragedy of the coronavirus pandemic — it contains both of these: Things which could have been prevented and things which could not have been.

Canada was not in a position to prevent the coronavirus outbreak, but it could have done more, and done it earlier, to prevent its spread. It was inevitable that we would be touched by the pandemic and that lives would be lost, but it was not inevitable that the virus would sweep through so many seniors’ residences unabated. More could have been done and more should have been done to protect our elderly and the most vulnerable amongst us.

Likewise, there was no avoiding the fact that a global pandemic would bring with it a significant economic impact. But it is undeniable that the government’s fumbling of the health crisis amplified the economic crisis we are facing today. No one expects a government to be perfect or to get everything right. But at a minimum, in times of a national crisis, the government should be doing everything it can to increase its effectiveness by being collaborative rather than combative, collegial rather than exclusive, and purposeful rather than political.

But this is not what we have seen from our government. In fact, this government’s response to COVID-19 is beginning to look like a hamster on a wheel, working very hard but not getting very far. We keep seeing the same scenes play out over and over again: Spending announcements followed by confusion and then uncertainty. Who qualifies? How do they apply? Why doesn’t the program cover this situation or this person? Why is this safety net full of holes? Why is there an announcement but no details on how the program will work?

We are nine weeks into the pandemic and yet, for some people, their ship is sinking and they still have no life raft. The government is selectively tossing out life preservers to some people while others are struggling to keep their heads above water.

Emergency spending announcements worth billions of taxpayer dollars are more appropriately made from the floor of the House of Commons, not from the steps of the Prime Minister’s cottage. It’s like they don’t believe Parliament is an essential service. Colleagues, Walmart is open; Costco is open; even Tim Hortons is open. Why on earth isn’t Parliament open? It seems that the less the Liberals have to be in Ottawa to be accountable, the more they like it.

Colleagues, today we have been called back to consider Bill C-16, An Act to amend the Canadian Dairy Commission Act.

I find it interesting, colleagues, that after making billions of dollars of announcements from the steps of his cottage, and after blocking Parliament from sitting more frequently in order to ensure appropriate accountability and consideration of policy proposals, the Prime Minister has asked Parliament to come back to change one word of one act.

In the Prime Minister’s mind, it’s too dangerous for Parliament to convene regularly in order to hold the government to account on the extraordinary spending of taxpayer dollars during a national crisis, but there is no hesitation to reconvene in order to change the word from “three” to “five.”

Don’t misunderstand me. I’m not suggesting that this change isn’t important, and we have every intention of supporting it.

On May 5, the Prime Minister announced new spending of $252 million to support farmers, food businesses and food processors. As part of this package, the government said it intended to increase the Canadian Dairy Commission’s borrowing limit by $200 million to cover the costs related to having to store excess cheese and butter. Dairy farmers have never seen a weekly fluctuation in the demand for milk like they are seeing now.

In addition, the sudden closure of restaurants and hotels across the country has resulted in excess production that is very difficult to manage. You can’t just shut off a milk cow one week because demand is low — we heard the minister say it’s not like shutting off a tap — and then turn it on the following week when demand is higher. It’s a bit more complicated than that.

The dairy industry has struggled to manage these challenges, including donating over $10 million in dairy products to food banks across the country and reducing quotas by 2 to 5%, depending on the province. In spite of these efforts, 30 million litres of milk still had to be disposed of at the farm because there was simply no place for it to go. Nobody wants to see that happen.

Dairy producers tell us that this amendment will help to “offset the impacts of bottlenecks in the supply chain that have prevented dairy from getting from the farm to the store shelf.”

So there’s no debate over whether today’s amendment is necessary. It is necessary to help the dairy industry navigate these turbulent times.

But what isn’t needed is a Prime Minister who only agrees for Parliament to sit when it suits his purposes and who does not seem to understand the weighty importance of parliamentary oversight at such a time as this. Whether he realizes it or not, he is diminishing the value of the nation’s most cherished institution, even while elevating his own.

Rex Murphy said it well in his April 27 column in the National Post:

Alas, the notion of an empowered Parliament in a time of national crisis is, in the truly immortal words of Sir Thomas Browne, a “dream and folly of expectation.” The idea of a national forum to keep check on our ruler, to exercise oversight on the massive dispensation of public funds, to question the decisions of our pre-noon prime minister, is, apparently, at this time simply a distraction, a waste of time, a useless clog to the impeccable functioning of a minority administration.

Nobody says it like Rex Murphy.

But Parliament is not the only target of the Prime Minister’s indifference. Our agriculture industry is also quite low on his list of priorities. There is no shortage of examples of this, but allow me to draw to your attention a few of them.

Number one: Government support for agriculture during this pandemic is absurdly inadequate. Consider the following: This is day 65 of the pandemic. So far, the government has announced $156 billion in direct support payments, which works out to the equivalent of $2.4 billion per day since the pandemic began.

If this spending were spread evenly across the population, it would work out to a cheque for just over $4,100 for every man, woman and child in the country, or $16,400 for a family of four. We all know this is not how money gets disbursed, but it helps to get a sense of the magnitude of the spending that is taking place. In actual practice, the money is disbursed through specific programs and targeted to specific people and industries.

Last month, the Canadian Federation of Agriculture assessed the COVID-related needs of the ag industry to be $2.6 billion. The government responded with an announcement that the industry would receive $252 million.

Colleagues, this is less than 10% of what the industry needs, and less than 0.17% of the government’s total direct spending on the coronavirus crisis to date. This is absurdly inadequate.

Number two: Not only is financial support for the ag industry inadequate, but some of it won’t arrive for months.

Part of the $252 million that was announced is to be used to create a $77.5 million Emergency Processing Fund. This fund will help food producers access more personal protective equipment, adapt to health protocols, automate or modernize their facilities, processes and operations, and respond to emerging pressures from COVID-19, so they can better supply Canadians with food during this period. But Global News has reported that this funding probably won’t be available until the end of September, and there are still no details on what the requirements will be to qualify.

Meat-processing plants have been hit hard by the coronavirus. A Cargill plant in High River, Alberta, was closed after an outbreak of 350 COVID-19 cases was linked to it. On Sunday, another Cargill plant near Montreal announced that it will be temporarily closing its doors after at least 64 workers tested positive.

This $77.5 million is supposed to help plants improve their working conditions in order to prevent outbreaks like this. Yet, as Global News reported: “As for when the money is expected to be doled out, the department said that will happen ‘no later’ than Sept. 30.”

September 30 is 139 days from now. By then we will have been in the pandemic for 204 days. How does this help the industry with COVID-related challenges they are facing right now? And why on earth is it being announced in May, like the funding is imminent, when it won’t be available for months?

Number three: Not only is the government’s support for agriculture absurdly inadequate, and some of it will not arrive for months, but the support is conspicuously smaller than what is being provided to other sectors.

The $252 million promised by the government includes money to help livestock producers faced with additional costs incurred by COVID-19. This includes set-asides for cattle and hog management programs, to manage livestock backed up on farms due to the temporary closure of food processing plants.

The amount earmarked for this purpose is $125 million. But here is the problem: Currently there are an estimated 14 million hogs and 11 million head of cattle. That is 25 million head of livestock. If you were to distribute the $125 million by livestock count, it would come to $5 per head. How far does $5 per head go? What would it pay for?

The daily cost of production can vary quite a bit across the country, but in Manitoba it comes in at around $3 per head per day for a cow/calf operation, or $5.75 per head per day for a feedlot operation. Hogs are more expensive to raise, at about $11 per head per day. This means that the government’s big announcement of $125 million for hog and cattle producers covers the equivalent of 12 to 24 hours of livestock production costs.

Hog and cattle producers contribute $13 billion per year to the Canadian economy, and when a global health crisis hits they receive only $125 million in assistance. That’s just under 1% of their total annual economic contribution.

Let’s compare this to what the government has done for students. The government has announced $9 billion in spending for students. Statistics Canada tells us there are about 2 million post-secondary students in Canada, so that works out to the equivalent of $4,500 per student, not including the money that has been earmarked for the Canada Summer Jobs program.

This $9 billion is to help students who are either part of the Youth Employment and Skills Strategy, are not able to find work, or are volunteering, or need help with their student loans. The Canada Emergency Student Benefit will cover them for up to 112 days, from the beginning of May through the end of August.

In other words, students get coverage for 112 days, but pork and beef producers get coverage for 12 to 24 hours.

I trust that no one will insult producers by suggesting that this comparison criticizes students. That would be absurd. Assistance should be available to students who need it, and no one should begrudge them that assistance.

The point I am making is this: Our ag industry puts food on our tables, so why is the government’s support for agriculture disproportionately small when compared to other sectors? It makes no sense.

The fourth example of the government’s low priority for agriculture is that much of the announced assistance to agriculture is just a re-announcement of previous commitments, and not new money for COVID-19 challenges. The government conveniently neglected to mention this, but half of the $252 million for agriculture is not new money; it was already part of the agriculture and agri-food budget for this year. The same is true for the increase of liquidity measures through Farm Credit Canada. Instead of a new COVID-19 assistance program, the Liberals simply re-announced a 2019 campaign commitment. This pattern by the government of re-announcing already existing support for the ag sector demonstrates that they do not consider agriculture to be a priority. If it was a priority, it would be reflected in the decisions they make and the resources they provide to the industry.

It is estimated that if immediate and meaningful support is not provided to help Canada’s agriculture and food industry, up to 15% of our farms, or about 30,000 farm families, will go out of business. The situation is serious. The unprecedented nature of this pandemic calls for unprecedented action, not recycled programs by a government that does not take the agricultural sector seriously.

Fifth, if you want to see how low the ag sector is on the government’s priority list, consider how they are treating the dairy industry.

Ask yourself this: What has the government done for the dairy industry since the pandemic required a virtual shutdown of the economy? Well, the first thing they did, as I mentioned last time we were in this chamber, is they stabbed the dairy industry in the back. The Dairy Farmers of Canada and the Dairy Processors Association of Canada were promised that the new Canada-United States-Mexico Agreement would not be implemented prior to August 1, so that the sector would have a full 12 months of exports at the year-one threshold on key dairy products, before being constrained by the significant reduction conceded in year two of the agreement. Instead of honouring that promise to our dairy farmers and dairy producers, the Liberal government was the first one out of the gate to give notice to the other parties that it was ready to implement CUSMA, a month earlier than promised. By ratifying the trade deal one month early, the government robbed the dairy industry of 11 months of operation at a preferred export threshold limit. This will cost the industry about $100 million. The government now says it will reimburse the dairy industry for these losses, but this does nothing to erase their egregious breach of trust. All it means is that they are now passing on the bill for their incompetence to Canadian taxpayers.

What about the legislation before us today? This bill increases the Canadian Dairy Commission’s borrowing limit by $200 million to cover costs related to having to store excess cheese and butter. Surely this demonstrates the government’s commitment to the dairy industry? Not really. Here are the facts. This is a necessary measure, but it will probably cost the federal government nothing. The Parliamentary Budget Officer has confirmed that almost every time the government announces a new loan program or other liquidity measure, the government makes money off it; they don’t spend money on it.

Take Farm Credit Canada’s $5.2 billion loan program, which the government announced on March 18. That assistance to farmers will net the government $96 million. The EDC’s $20 billion small- and medium-sized enterprise loan and guarantee program will bring $3 million into the treasury. The BDC’s $20 billion small- and medium-sized enterprise loan and guarantee program will net the government $389 million. The $150 billion insurance mortgage protection program credit and liquidity support will bring in $428 million for the government.

The additional $200 million in borrowing room that Bill C-16 provides is needed and welcome, but don’t assume it will cost the government a nickel. We’ll have to wait for the Parliamentary Budget Officer’s costing note on the matter, but it’s highly likely that the government will be making money off this program as well.

The other thing you need to understand about how the government is treating the dairy industry is their proposed handling of something called tariff rate quotas or TRQs. Here is how the Dairy Processors Association of Canada explains the significance of TRQs to the dairy industry, “TRQs or dairy import licences are designed to protect Canadian industries harmed economically by international trade agreements like CETA, CPTPP or CUSMA. Traditionally, they provided industries like ours with financial stability over the long term. With TRQs, we import products at no or low-rate tariffs, which we then offer through retailers to Canadians at competitive prices. The profit helps compensate our industry for losses resulting from international trade agreements.”

The problem is that the Prime Minister is about to give 100% of these quotas to retailers rather than to the dairy processors. The dairy processors are very concerned about this because the retailers have suffered no economic harm from the recent trade agreements, whereas the dairy industry has. This makes no sense — except I do recall that the government felt it needed to charge taxpayers $12 million for refrigerators for Loblaws last year. Perhaps now it wants to fill those refrigerators at the expense of the dairy industry.

Here is why the dairy processors believe they should get TRQs and not retailers: Simply put, retailers and distributors have not been harmed economically by recent trade agreements. They don’t make any products. They merely offer them to Canadian consumers, and they make a profit in doing so. Dairy processors, on the other hand, have made significant investments in their manufacturing facilities to develop and market dairy products. Allocating TRQs to us provides our businesses with the predictability and the stability needed to continue to invest and help provide us with a reasonable return of investment for the investments we’ve made.

The Dairy Processors Association of Canada maintains that it is imperative that TRQs related to the CPTPP and CUSMA trade agreements be allocated to the dairy processing industry to compensate for losses it will suffer because of increased access granted to the Canadian dairy market. But for some reason, the government is not listening. This is becoming a pattern with how they treat our dairy industry and our ag industry as a whole.

The sixth example of how low the ag industry is on the government’s priority list; take a look at how they treat the grain industry. It did not escape the notice of Canada’s grain growers that they were completely left out of the $252 million package for agriculture and agri-food.

Following the government’s spending announcement, the Grain Growers of Canada had this to say:

This relief package offers no resolution to our existing issues, which result from long-standing market access challenges, rail blockades, and 2019’s harvest from hell.

As net farm incomes continue to plummet, the federal government has only offered relief programs that are either not applicable to the majority of farms or prioritize access to debt for already highly leveraged farmers. This relief package, unfortunately, maintains that trend.

Time after time the Liberal government fails to step up to the plate for Canada’s grain growers. This is just the latest example.

Without exaggeration, I could probably keep giving you examples of the government’s disdain for our agriculture sector until midnight — I think our motion says we can sit here till midnight — but I doubt it would keep your attention that long, so allow me to note one more, number seven, the federal carbon tax.

It is difficult to find something that is going to hurt the ag industry more than the carbon tax. Farming is heavily dependent on the use of fossil fuels because tractors don’t actually run on horsepower anymore. They use diesel fuel.

Grain isn’t dried by airing it out in the sunshine like it was hundreds of years ago. Farmers use propane heat to dry their grain.

Then there’s rail transportation, heating and electricity, and trucking that is necessary for many aspects of farming. These all require carbon-based fossil fuels to which there is currently no reliable alternative.

And contrary to what Elizabeth May of the Green Party or the Bloc Québécois may want you to believe, it’s a little difficult to mount a bank of solar panels or a wind farm on top of a tractor.

That’s the first problem with the carbon tax: Farmers use a lot of carbon-based fuels.

The second problem is that farmers are price takers and will be unable to pass on the cost of the carbon tax to consumers like many other industries will.

The net result of these two factors, according to research done by the Agricultural Producers Association of Saskatchewan, is that:

. . . farmers can expect to lose 8% of their total net income in 2020 to the carbon tax. For a household managing a 5,000‑acre grain farm in Saskatchewan, this will take the form of a $8,000-$10,000 bill.

In less than two years, when the carbon tax increases to $50/tonne in 2022, this bill will go up to $13,000-$17,000 for the same household — the equivalent of a 12% decrease in net income.

Producers across the country are very concerned about the carbon tax and rightfully so. I note that Senator Griffin has drawn the attention of this chamber to this fact through Bill S-215, an Act to amend the Greenhouse Gas Pollution Pricing Act (farming exemptions).

But while farmers are very concerned about the impact that the carbon tax will have on the ag industry, and while senators are paying close attention to this concern, the government is paying none. How do we explain all of this?

On the one hand, we get statements like the following from the Minister of Agriculture and Agri-Food Canada, Marie-Claude Bibeau, who was here today:

I want to reassure all our farmers and agri-business owners across the agri-food industry that our government fully understands that they are essential to our communities and that we are fully engaged to help them through this unprecedented period.

But then, on the other hand, this talk is never followed up with action.

What are farmers supposed to make of this?

If the government was at least consistent in how it treated Canadians, then perhaps we could conclude that they are probably giving it their best shot, but they are far from consistent.

They breeze over the needs and concerns of the ag industry while indiscriminately sending money to people who don’t even qualify for it.

I’m sure you have all seen the National Post headline, which we talked about this morning: “’Do not impose a stop pay’: federal workers ordered to ignore cheating in CERB and EI claims.”

That was the quote in the National Post.

Apparently, a memo recently went out to employees of Employment and Social Development Canada, along with Service Canada, which said the following:

Effective immediately, while processing a claim, if an agent uncovers information that suggests potential abuse of the EI system by a client, an employer or a third party, they do not impose a stop pay and do not refer the file to integrity unless it is considered an urgent investigation.

This is a result of the integrity service branch suspended all non-critical investigations. In addition to suspension of Claimant Information Sessions (CIS), in-person interviews and on-site visits, they have suspended all Integrity Operations activities for compliance and enforcement of the EI program.

I find this unbelievable. How can you deny our farmers the assistance they desperately need while at the same time shovelling money out the door to people who don’t even qualify? And you have no mechanism of collecting it back.

How do you turn a blind eye to claims that you know are fraudulent and insist on sending them money anyhow while brazenly ignoring critical financial needs in our ag sector?

This speaks not only to the government’s poor attitude toward the ag sector, but it also illustrates the incompetence with which it is handling the pandemic.

Colleagues, in closing, let me say this: I found it troubling to read that the office of the Auditor General has had to suspend much of its work due to lack of funding.

Allow me to quote from an iPolitics story.

Canada’s auditor general says the lack of funding for his office has left it no choice but to delay work on most audits, as the COVID-19 pandemic adds new demands on the resource-stretched office.

Interim auditor general Sylvain Ricard told the House of Commons finance committee on Tuesday that his office has had to suspend work on all but three audits.

We might ask the nominee about that later on.

This, colleagues, is unbelievable and unacceptable. At a time when government spending is at all-time historic highs and the Prime Minister is bragging that they have introduced the “biggest economic measures in our lifetime,” the one thing he cannot find the money for is the office which holds him accountable for his spending.

Doesn’t that strike you as a little odd?

First, the Prime Minister doesn’t want Parliament to sit too often and ask too many questions; then he won’t pay the Office of the Auditor General to do its job as the spending watchdog.

Colleagues, I must admit that the government is providing all the necessary elements for a good conspiracy theory. And like you, I get countless emails from those who are convinced that the government is involved in some kind of a nefarious plot, furtively working in the shadows of dark corridors to align the pieces of its secret agenda.

Well, I personally doubt it, not because I am teeming with confidence in this Prime Minister’s motives, but because I am pretty certain that any successful conspiracy requires at least some level of competence. Clearly, this is not something that this government has.

Just so that you know, I am sure that many of you heard the exchange yesterday, or the day before, maybe, in the House of Commons where MP Pierre Poilievre asked the Finance Minister a series of basic questions about the state of our country’s finances. The first question was:

What is the total dollar value of the assets of the Government of Canada?

The second question was:

What are the total liabilities of the Government of Canada?

The third question was:

I know we shouldn’t ask the minister about numbers. He’s just the finance minister, after all, but what is the equity on the Government of Canada’s balance sheet?

The fourth question was:

Can the minister, if he is familiar with any of these numbers, tell us if it is possible that his government will hit $1 trillion of debt this year?

The final question was:

What is the size of our current national debt?

Colleagues, the Finance Minister was unable to answer one single one of those questions — not one question could he answer. Now, either he didn’t want to answer, which is shameful when we finally get to see him once a week, or he is incompetent if he doesn’t know.

Colleagues, if you had a business and you had a chief operating officer and you walked into your office and asked, “What’s our balance sheet?” what would you do if he didn’t have an answer? You would fire that individual.

Here we have a Minister of Finance, and when your Minister of Finance doesn’t seem to know the fundamentals of the nation’s financing, you know you have an incompetent administration in office.

Colleagues, today the Conservative caucus will be supporting the passage of Bill C-16 unanimously, not on division, because dairy farmers need this and it is needed by the industry at this critical time. But what we cannot and will not support is this government’s indifferent attitude toward our agriculture industry.

I invite all senators to join me in urging the government to not just acknowledge that the agriculture industry provides essential services, but to begin to demonstrate this by providing the support and the services that this industry needs in this time of need. Thank you.

Hon. Jim Munson

It is hard to match that, senator.

It’s in the middle of the afternoon and very serious subject matter, and I applaud; as you once said before, Jean Chrétien did say in the word opposition, there’s a great big O. That means you oppose and you’ve done that quite well.

Well, you have a choice, sir.

Before I get into a very short and limited speech, I was thinking about what Senator Coyle spoke about, milkshakes and ice cream and so on. I’ve had time during your speech to do some intensive research. I’ve discovered, as a maritimer, there’s a new drink out there called rum cow, and there are all kinds of ingredients to it. I’m just thinking that in support of the dairy farmers, I’m going to support this rum cow drink. I won’t go through all of it, but there’s a lot of milk in it; six ounces of milk and a little bit of rum. It’s only 3:15, but it’s getting kind of dangerous now if you’re from Atlantic Canada.

I am here to speak on behalf of the progressive senate group, I’m pleased to rise to offer comments on Bill C 16, An Act to amend the Canadian Dairy Commission Act. Others before me have also reviewed the bill, so I’ll keep my comments brief.

I’ve been chatting with my good friend Senator Mercer — who knows what Senator Mercer is doing now since it’s 4:15 — from Nova Scotia. He wanted to pass along some comments on the bill. Of course, he has been an esteemed member of the Agriculture Committee and is an ally and friend of farmers across this country.

From Senator Mercer: Our world is a different place. Restaurants and other businesses are closed, and consumption of milk and milk products has declined significantly. And while we are starting to see some light at the end of the tunnel across the country in terms of slowly opening our economies, we still have a long way to go. The agriculture and agri-food sector has not been immune to the perils of COVID-19. Help is needed now for our farmers and this bill is one part of that assistance.

Honourable senators, no one wants to hear about farms having to dump milk. Our farmers have always donated what they can, when they can, to food banks, as we heard from the minister this afternoon, and that is to be applauded. But our farmers cannot donate raw milk, only its products.

That is why this bill is essential because it creates the extra capacity to bulk purchase products that can be stored and so it should help to prevent raw milk waste. It will put much-needed funds in the hands of producers and processors.

One thing we should acknowledge is our supply-managed system. Reacting to severe changes in production and demand is a key component. The COVID-19 crisis has put extra pressure on the system and so this bill should, we hope, help weather the storm.

Finally, it is also worthwhile to note that the funding announced by the federal government across the agricultural sector is nowhere near the Canadian Federation of Agriculture’s requested amount, but it is a start. We will all be watching and listening to see what more should be done.

Today we are looking at dairy, but tomorrow we will be looking at other parts of the agriculture and agri-food sector.

Farmers are the backbone of rural Canada. In fact, farmers are the backbone of this country. But we should remember that they are all the lifeblood of all Canadians.

Thank you.

Hon. Jean-Guy Dagenais

Honourable senators, I want to share a few thoughts on the bill before us, Bill C-16. First off, I must say that I am deeply appalled to see the government in power handing out aid to Canadians and businesses with daily announcements, as if it were on the campaign trail, forcing us to approve actions one by one when they could have been combined and consolidated in a single bill. This kind of political showboating only confirms one thing, namely that after two months of pandemic, this government is incapable of carrying out a serious analysis and having an overall vision of the actions that need to be taken to save Canadians, in terms of both health and the economy.

Having a political vision of what our country needs during this crisis doesn’t mean making daily announcements by fits and starts where you selectively dole out cheques. After listening to the Prime Minister and the ministers of this government, I’m also firmly convinced that nobody has thought about what happens after COVID-19 yet. Will they ever be able to do that? Somehow I doubt it.

The almost theatrical performance that Mr. Trudeau puts on every morning is not the least bit reassuring. Although there may be a valid reason for putting the country and Canadians in debt, the lack of information on exactly how much this is going to cost and how Canadians will pay for it is cause for concern, particularly with a government that has done nothing but rack up deficits since it took office. As senators, we do not have the right to reject Bill C-16 today. In this time of crisis, we must approve the assistance this bill offers farmers, even if it comes up short. However, our support for Bill C-16 in no way means that the senators here today approve of the shortsighted policies that the Liberal government is implementing to address the problems that our farmers and producers will have to deal with in the coming years. At least that is how I feel. I am talking here only about those who will succeed in weathering the crisis, because it doesn’t take a genius to realize that some farmers will lose everything.

As senators, we should be asking ourselves how we can stand by while the current government announces new financial measures to help the agricultural industry, measures that could very well have been included in Bill C-16 before we even passed the bill. That is pretty pitiful from a political standpoint.

In my opinion, agriculture, agri-food and the fisheries are all parts of a whole, and these sectors represent above all an important and key part of our country’s economy. We need only spend a few minutes listening to industry representatives and farmers to see that bills like Bill C-16 and others that are likely coming in the next few weeks do not and will not meet the expectations and needs of our producers. I’ll tell you why. The current government does not understand agriculture and is not listening to those who can offer solutions.

I was very pleased to be a member of the Standing Senate Committee on Agriculture and Forestry over the past eight years. I often posed the same question to agricultural stakeholders and experts who came to offer their perspectives on government decisions. I would ask them whether they had been consulted before the announcement of political decisions that affected them directly. The answer was always the same: no. Always no. It is unacceptable.

Honourable colleagues, agriculture is an economic driver of the highest importance for Canada, as much or even more than the automobile, aerospace, and new technologies. However, the Liberals are city-dwellers who think tomatoes grow in grocery stores. I may be exaggerating a bit. If the Liberals were truly interested in agriculture, it would not have taken two months of pandemic to come up with this paltry and flawed Bill C-16.

Some of this country’s pork and beef producers will have to put their animals down. Some produce growers will lose their crops. Some processors will have to lay off workers, and some truck drivers will have nothing to transport. Plus, food prices are expected to rise in the coming years. Agriculture in Canada is all those things. It’s now clear to me that our food supply chain is in jeopardy and consumers will pay the price. Politically speaking, let me tell you this. Compensation cheques won’t grow the agricultural sector.

Compensation cheques are for righting wrongs like those in the international agreements this government negotiated, agreements that always give our farmers the short end of the stick. For our agricultural industry to survive, we need much more than compensation cheques. We need vision, and that’s what this government lacks. We need vision to help our agricultural sector achieve more and to ensure that Canada continues to be a global food supplier.

Our prairie wheat, maritime potatoes, Quebec and Ontario milk, our fruit, vegetables, pork and beef are the foundation of a strong and competitive agriculture industry. Our American neighbours released $19 billion to help their agricultural producers, who often compete against our own producers. Meanwhile, our farmers and producers have called for $2.6 billion in aid, but the government responded by introducing Bill C-16, which gives them $252 million.

That is barely 10% of what they asked for and of what is clearly needed to save this industry. Of course the government will make other announcements. I listened to the Minister of Agriculture and Agri-Food rhyme off what is available to our farmers. I tell you sincerely that it is hard to make heads or tails of it all. Figures, programs, changes to existing programs, brand-new measures and, of course, old measures recycled to make us think that there is something new.

We are seeing a patchwork effort that illustrates precisely how I’m right about the Liberals. They have no comprehensive vision of Canada’s agriculture industry. When cheques are handed out to students who may not have a job this summer before meaningful assistance is given to agriculture, we clearly see where the government’s priorities lie.

I was pleased to see that just yesterday, the Parliamentary Budget Officer, Yves Giroux, shared my concerns. This government seems incapable of developing a post-Covid-19 economic plan. It’s focusing all its energy on writing cheques, without being accountable to those who will one day have to pay for these cheques. I’ll get back to Bill C-16, which we are discussing today.

Once again today, we’re being forced to tolerate all this so that farmers can access some financial assistance, and the Liberals benefit from that. However, I’m again shocked to see that no one in this government is capable of looking more than six months ahead for our agriculture and agri-food industry. We’ll need a lot more time, imagination and money than we have right now to recover from this pandemic. We will have some choices to make, difficult ones, but agriculture is not a choice. It’s an obligation that we must all support. Thank you.

Hon. Julie Miville-Dechêne

So very many have been lost to COVID-19, and I’d like to take a moment to express my heartfelt condolences to their loved ones, especially to our dear colleague, Senator Raymonde Saint-Germain, who lost her father. My condolences, Raymonde. Yesterday, on the island of Montreal where I live, they announced the death of a 27-year-old woman, apparently with no prior health issues. She is the youngest victim so far. Many health workers are worn out. They account for half of all cases in people under 60. I salute them all. We can only hope that things in Montreal get better because it’s very hard right now.

I want to speak to Bill C-16, the Canadian Dairy Commission bill, because the health crisis is really hurting the dairy industry, which is very important in Quebec. Half of Canada’s dairy farms are in Quebec. They produce 36% of this country’s milk and, it’s worth noting, 60% to 70% of this country’s cheese. COVID-19, combined with the Canada-United States-Mexico Agreement coming into force earlier than expected, is destabilizing dairy producers, who work tirelessly on their farms.

I want to take this opportunity to dispel some negative preconceptions about this industry, which is described by some as a spoiled child because it benefits from a supply management system. The system isn’t perfect. I’m aware of that. Consumers pay more for their milk, but let’s compare what is happening on both sides of the border. As was mentioned, there was a dramatic increase in the demand for milk for two weeks at the beginning of the crisis, followed by an incredible drop due to the closure of restaurants and schools. As a result, in Canada, nearly 30 million litres of unsold fresh milk was thrown into manure pits.

Meanwhile, south of the border, where there is no supply management system, it is estimated that American dairy farmers have been throwing 14 million litres of unsold milk into manure pits every day since the beginning of the crisis. They also dump milk under normal circumstances.

Let’s come back to what’s happening in Canada. According to University of Laval professor Maurice Doyon, who is an expert in the matter, our supply management system, which involves centralized decision-making, proved its worth by limiting waste in this time of crisis.

According to Mr. Doyon, a mandatory 2% reduction in production was called for. Credit days — I found out what that means, it’s when a farmer is allowed to exceed their quota during the lactation period — were totally eliminated. This reduced the volume of milk produced by 4%. The losses were distributed equally among the farmers, based on their quotas.

As mentioned earlier, the industry also made major donations to food banks, amounting to four million litres, which presented a logistical challenge, because donated milk still has to be packaged or processed. Contrary to popular belief, farmers only get paid for milk that’s sold, not for milk that’s dumped.

As a result, farm revenues have fallen by 10% to 15%, largely due to the drop in global prices. This may not seem like much compared to other industries, but dairy farmers are heavily in debt, since they have herds they have to feed and care for. I talked to a dairy farmer yesterday, and he told me about the stress, the uncertainty and the increasing reliance on credit, since expenses aren’t going down. Furthermore, farmers who run their farms alone or with a spouse are terrified of contracting COVID-19, because there’s no one to take their place.

Bill C-16 is no miracle; it’s a short-term measure to help sell milk. Should we have reduced production even further? Perhaps, but then cattle would have to be sacrificed, and if demand were to go up again six months from now, farmers wouldn’t be able to meet it, because it takes 18 months to repopulate a herd.

Another complicating factor is that COVID-19 has changed people’s eating habits. We are eating at home, because restaurants and cafés are closed. More cow’s milk is being consumed, 7% more, but a lot less cream, yogurt and cheese are being consumed. Demand for fine cheeses has dropped by 50%, by even up to 90% in the case of certain artisanal cheeses, a hallmark of the industry in Quebec. That province is therefore being hit harder than some other ones, considering the nature of its production.

The other bad news for the milk industry is that CUSMA will be coming into force not on August 1, as we hoped, but on July 1. This means that, in just one month, Canadian exports of skim milk powder and milk protein concentrate will be cut in half, with no adjustment period whatsoever.

In spite of promises of compensation, farms will inevitably disappear, especially since the health crisis could destroy those that are already on the brink. Quebec’s dairy sector accounts for nearly 83,000 jobs, particularly in the regions. The health crisis is reinforcing the importance of buying and producing locally, and our dairy industry is part of that trend.

Once the crisis has passed, should the dairy industry think about needed adjustments to the supply management system and about the need to innovate even more? Without a doubt. When I listened to witnesses in parliamentary committee last year, I was struck by the absence of innovative export projects in supply managed sectors.

That said, I will support Bill C-16 without hesitation.

Thank you.

Hon. Pierre J. Dalphond

Again today, before speaking to Bill C-16 before us, I must say a few words about the situation in the long-term care facilities in the Montreal area, where I’m from. I want to take this opportunity to offer my condolences to Senator Saint-Germain, who lost her father to COVID-19, like hundreds of other people every day.

The pandemic has highlighted not only the importance of Canada’s public health care system, which allows us to fight COVID-19 much more efficiently than our neighbours to the south, but also the weaknesses of the intervention models used for seniors, people suffering from serious cognitive issues and people with reduced mobility.

In a television interview on Wednesday, Pauline Marois, former premier of Quebec, said:

I think we’re off-track. When I say we’re off-track I’m not only talking about the current government. All the successive governments were off-track and today we are paying the price. Our parents and grandparents [are paying].

She adds:

Is grouping [seniors together], even in private residences where people often pay for very expensive apartments, a good idea? Aren’t we creating ghettos? Living with our children, with our grandchildren, with people of different ages, it perfectly natural.

These are very pertinent questions that Quebec society and, to a lesser extent, Ontarian society will have to grapple with in the months and years to come. I hope that the federal government will be paying attention to and collaborate on this issue by providing various measures such as tax incentives to encourage multi-generational housing and enhanced health care funding for home care.

The importance of Bill C-16 is not reflected in its length. In fact, it has but one small clause of four lines, a single and short clause that increases the borrowing capacity of the Canadian Dairy Commission by $200 million to $500 million. This increase in the commission’s borrowing power will allow it to purchase and temporarily store more dairy products in order to provide stability to the Canadian milk market, which really needs it right now.

As a Quebec senator, I have to mention the importance of the dairy industry because I grew up in the country surrounded by dairy farms.

I would now like to go back to some of the ideas that Senator Miville-Dechêne explored. As you undoubtedly know, Quebec is the largest producer of milk in Canada as Quebec cows produce on average 40% of Canada’s milk. In other words, Quebec produces 40% of the 92 million hectolitres of Canadian milk. That’s a lot of quarts of milk, as we used to say.

Of the 18,805 Canadian jobs related to the production of milk and cream, 9,425 are located in Quebec’s 5,050 dairy farms. Quebec is also home to the biggest milk processors in the country, like Saputo and the Agropur co-op, two companies that are Canadian owned.

Quebec is renowned for the quality of its industrial cheeses and especially for its artisanal cheeses. It’s a real joy to travel around Quebec and discover all the local cheeses. But this important sector of Quebec’s economy needs to adapt to a new context, given that the Canadian market is being opened up to dairy products from other parts of the world, including Europe, the trans-Pacific region and, soon, the United States. All in all, nearly 10% of the Canadian market will no longer be protected. In addition, the United States’ market access will grow by 1% a year for the next 13 years.

Meanwhile, Canadian exports are seeing fairly sluggish growth. In 2019, Canadian imports rose by just over 20%, while exports fell by about 6% compared with 2018. In a nutshell, dairy imports totalled almost $1 billion in 2019, whereas our exports didn’t even hit $500 million. The gap seems to have been widening for several years.

With the coming into force of the Canada-United States-Mexico Agreement, which limits Canadian exports of skim milk powder and infant formula, we may not be able to narrow that gap. Following the signature of the most recent trade agreements, the Canadian government committed to compensate the industry for its market share losses and to provide it with financial assistance so that it can become more competitive and do better when it comes to exporting. From what I understand, the first forms of financial aid or compensation have begun to be paid. There’s still a lot to do, however.

The industry was already facing significant challenges when the pandemic hit. Then, schools shut down and breakfasts, including milk, were no longer being provided for underprivileged children. Restaurants and hotels closed their doors, putting an end to their use of various dairy products for meals, desserts and, of course, cheese platters. In other words, the pandemic came at a very bad time. Dairy farmers are being forced to throw millions of litres of milk into manure pits. Nearly 30 million litres were reportedly thrown out between the end of March and mid-April. No farmer wants to waste milk like that. Many of them, in Quebec and elsewhere in Canada, started donating more dairy products to food banks. However, that wasn’t enough to get rid of the surplus of milk and especially milk products.

Today, we should be glad the Canadian Dairy Commission will be able to buy more dairy products and store them temporarily as a way to stabilize the market and, ultimately, the price paid to producers for milk and milk fat. This guards dairy producers against sharp drops in revenue and potential bankruptcy.

Dairy production isn’t easy. It requires significant investment. Farms with 40 or so cows like the ones I used to know don’t exist anymore. Farms nowadays have hundreds of cows.

We can’t scare off the next generation by opening ourselves up to foreign competition and deregulation. Quebec’s dairy producers are happy with this change to the Canadian Dairy Commission’s borrowing capacity. Nevertheless, they’ve pointed out that this measure alone, like other measures introduced for the agricultural sector as a whole, isn’t enough for the dairy sector. It’s a step in the right direction, but that’s all. The government must do more.

Canada’s dairy farmers also welcome the measure we’re passing here today, as well as the additional funding provided under the AgriRecovery program to create a set-aside program that will include cull dairy cows. This project allows cows that are no longer producing milk to be pulled from the market and processed for meat. Since the current market is so low, those cows must be kept longer on the farm, and so we need to subsidize the farmers. The program will compensate farmers for the costs involved in keeping less productive cows in the herd over a longer period. However, I repeat, this is not enough.

In closing, I urge the government to go further in adaptation support for dairy farmers. I also urge my fellow Canadians from coast to coast to consume Canadian dairy products, which are second to none are produced in conditions that are superior to those of many other countries. These products are of the highest quality and are good for you. I drink a litre of milk almost every day, and I’m doing great.

Thank you, meegwetch.

Hon. Rosa Galvez

Honourable senators, I would like to take this opportunity to extend my sincere condolences to our dear colleague on the loss of her father, Joseph-Louis Saint-Germain.

Honourable colleagues, I rise to support Bill C-16, which amends the Canadian Dairy Commission Act to increase the maximum total for outstanding amounts of loans made to the commission by the Minister of Finance and for amounts drawn by the commission from a line of credit to $500 million dollars.

The time has come to help the Canadian dairy industry, which has seen a decrease in the demand for its dairy products, in particular cheese and cream, forcing dairy producers to dump unprecedented volumes of excess raw milk.

Dear colleagues, I would like to draw your attention to some vital and more global aspects that will have to be examined in the medium term as we move forward and out of this pandemic.

In parallel to this unprecedented health crisis, we face unprecedented economic crisis. Bill C-16 is part of the economic crisis management plan of the government. The plan is hopefully unfolding in three stages: First, keeping our economy afloat during the emergency; second, providing relief to essential economic sectors and workers; and third, providing economic stimulus to restart the economy sustainably.

If we have learned from previous crises, this last stage must restructure and renew the foundations of our economy for it to become truly robust, resilient and prosperous but also one that brings equitably distributed social benefits and respects the ecological limits of the regions that we inhabit.

Stages one and two are resulting in an increase in this year’s budgetary deficit estimated by the Parliamentary Budget Officer to reach $252.1 billion. The economic stimulus phase will likely require more public funding which will further increase by a wide margin our pre-COVID-19 national debt of $685 billion. This debt is 70% owned by Canadians and 30% owned by international lenders. This debt will be paid by Canadians of this and future generations, and we must act responsibly for them. If we are to avoid fatal economic collapse, we must plan the recovery and stimulus phase in a way that will generate sustainable gains over time. We should strive to avoid attempting to address this debt through the restrictive austerity measures that followed the 2008 financial crisis whose years of funding cuts are partially responsible for our health care systems being ill-prepared to address COVID-19. Thus, we must be strategic and prioritize. First, measures that maximize employment, mostly small- and medium-sized enterprises; second, organizations that will improve our quality of life and generate revenue for Canada; and third, rethinking strategically and renew the development of the health, food, industrial and manufacturing sectors.

We need an industrial policy that revisits the chain of production of essential products and rethinks our agricultural sector in terms of food security. Was it normal that intermediary brokers made millions of dollars on the backs of Canadian farms? Was it normal that 60% of seeds for grain growers are controlled only by three multinationals? We must look at these issues, while also addressing other crises such as climate change which likely increases the risk of future pandemics.

Our health, safety and service workers are already exhausted and very much underpaid considering the huge risk they face every day. We were already very much under-prepared and remain ill-prepared for secondary waves that may strike. Like, for example, I’m sure you know, next fall, when COVID-19 and the seasonal influenza will both strike us.

Thankfully, experts are reflecting fruitfully on all of this, and we would do well to listen to them. For example, researchers from Oxford, the London School of Economics, Columbia and Cambridge universities surveyed 231 central bank officials, finance ministry officials and other economic experts from G20 countries on the relative performance of 25 major fiscal recovery measures, studying them under four dimensions: speed of implementation, economic multiplier, climate impact potential and overall desirability.

The researchers identified five policies with high potential on both economic multiplier and climate impact metrics. These are investments in clean energy infrastructure, building efficiency retrofits, food and essential products self-sufficiency, education and training, natural capital and clean research and development.

The lowest rated overall policies were airline bailouts, traditional transport infrastructure bailouts and income tax cuts. The report warns that bailouts of emissions-intensive industry such as airlines and fossil fuels are not advisable and, at the very least, should be conditional on these industries developing a measurable plan of action to transition towards a net-zero-emission future.

Countries have specificities and, in Canada, dairy is an important economic sector that contributes to food security and is therefore essential. But there would be very little revenue recuperated from many other industries and therefore we must carefully choose. For example, when it comes to Canada’s cost and emissions-intensive oil sector, that does not account for climate impact externalities or the cost of remediating land wells and tailings ponds estimated as high as $260 billion. This could be very dangerous.

With the OECD, World Bank and International Monetary Fund advising in favour of sustainable finance for the stimulus post-COVID-19, it is not surprising to learn yesterday that the Norwegian sovereign wealth fund has abandoned 4 of the 10 biggest oil sands companies in Canada after concluding they produce unacceptable levels of greenhouse gas emissions. This not only highlights the fact that international investors are disinterested but also that foreign ownership of publicly traded oil sands companies may reach 70%, meaning a majority of the profits are still leaving the country.

Colleagues, the “do no harm” principle requires us to face the complex and perilous future of growing and interacting sanitary, social inequality and climate crises. We must double down on climate action for our kids and grandkids to reduce the risks of future pandemics and the premature deaths and illnesses associated with the same pollution that is harming the planet and build a new economy that works towards these goals.

Future stimulus must support industries and projects that decrease greenhouse gases, increase economic resilience through diversification and provide workers with retraining opportunities, making us more self-sufficient with respect to all essential products and services.

We hear calls about going back to normal. But normal was killing people; normal was rendering physically and mentally ill the farmers, the people. Normal was disrupting our global climate on which we all depend.

Colleagues, instead of going back to normal, let’s go forward and build a prosperous future. The decisions we are all taking these days are historical. Our words and debates will be remembered. Thank you.


Honourable senators, I rise today to speak to Bill C-16, An Act to amend the Canadian Dairy Commission Act. This legislation seeks to increase borrowing limits for the Canadian Dairy Commission and is intended to provide immediate relief to the sector to address significant milk surplus due to COVID-19. These measures are responsive to industry requests, supported by the Canadian Dairy Commission and the Dairy Farmers of Canada.

Like many other sectors, the agriculture sector industry has suffered significant economic loss due to COVID-19. We’ve heard that fluctuation in demand for milk since the beginning of the pandemic has been considerable. Although shoppers are still buying butter and cheese at a steady pace, restaurants and hotel closures have greatly reduced demand for dairy products. Despite efforts to align production with consumer demands, there have been bottlenecks in the supply chain. As a result, many farmers have had to dump raw milk, an estimated 30 million litres or 4% of production so far.

As you have heard already, the proposed bill is responsive to these issues. The measures before us will help relieve the issue by increasing the maximum total for outstanding amounts of loans to the Canadian Dairy Commission by the Minister of Finance and for the amounts drawn by the commission. The $200 million increase bumps up the maximum loan from $300 million to $500 million. Officials confirmed on a briefing call earlier this week that between $100 million and $110 million will be deployed as soon as possible for immediate relief to the sector. An additional $70 million to $80 million be retained for use at a later date as industry calibrates its demand with consumers in this new normal.

Earlier today, I asked Minister Bibeau about other programs benefiting milk producers and processors, and I want to return briefly to those today.

This amendment builds on last week’s announcement of $252 million for a broader support package for the agriculture sector to support farmers, food businesses and food processors who provide essential services to Canadians. The proposed increased borrowing limit will work in tandem with several existing government programs, such as a program that helps producers transform their products. The extra borrowing capacity provided for in this amendment will help farmers access the necessary means to turn their milk into other dairy products like cheese and yogurt. This in turn will help offset excess milk and preserve products for longer periods of time, helping both farmers and organizations like food banks with storage issues.

Some farmers are already making plans to do this and will support local food banks in the process. This past Monday, the Dairy Farmers of Manitoba and Bothwell Cheese announced that they are turning excess milk into thousands of kilograms of cheese for Winnipeg Harvest, a not-for-profit, community-based organization that collects and shares surplus food with people who are hungry. This partnership is expected to produce 6,000 kilograms of cheese over the next few months, which equates to nearly 60,000 litres of milk.

Farmers and agri-food workers can also draw on several other emergency benefit programs to help recover losses, such as the wage subsidy program, which can provide up to 75% of employee wages for up to 12 weeks, retroactive to March 15, 2020. This enables businesses to rehire workers previously laid off as a result of COVID-19 and is intended to help prevent further job losses and better position businesses to resume normal operations following the crisis.

The Canada Emergency Business Account will also help to support small businesses, including eligible agri-food workers and dairy farmers, in order to provide access to capital they need to help cover operating costs during periods where their revenues have been temporarily reduced due to COVID-19. This $25 billion program provides interest-free loans of up to $40,000 to small businesses to help weather this storm.

In addition, the government announced more details earlier this week for the Regional Relief and Recovery Fund program. A figure of $1 billion will flow through six regional development agencies, which are familiar with their regions’ economic realities and are often the first point of contact for people at the local level. This program is intended to mitigate the financial pressure experienced by businesses and organizations, and allows them to continue their operations, including paying for their employees. It also supports projects by government organizations and communities to prepare for a successful recovery following the pandemic, and carves out $287 million to support the Community Futures Network, development corporations specifically targeting small businesses and rural communities across the country.

The agri-food sector will continue to benefit from a myriad of existing programs outside of emergency relief programs due to COVID-19, including the Canadian Agricultural Partnership, a five-year, $3 billion investment by federal, provincial and territorial governments launched a couple of years ago, which is aimed to strengthen the agriculture and agri-food sector by offering simplified and streamlined programs that are easier to access. It also provides for enhancements to programs that help farmers manage significant risks that threaten the viability of their farm and that are beyond their capacity to manage. This is particularly important in the current context in which farmers are responding to the economic impacts associated with the pandemic.

In order to ensure the food supply chain stays strong in Canada, the government is also providing relief for farmers who rely on the existing Temporary Foreign Worker Program. An amount of $50 million has been allocated for farmers so they can safely welcome temporary foreign workers while complying with the Quarantine Act. In order to ensure that farmers have access to these workers for the growing season, the federal government will provide support of $1,500 for each temporary foreign worker to employers or those working with them to ensure requirements are fully met.

The minister mentioned today that as of April, 22,000 temporary foreign workers had arrived in Canada, representing 80% of the number at the same time last year, which is a considerable success during uncertain and unpredictable times.

Colleagues, this range of programs available to eligible farmers will provide for stability in the sector while prioritizing public health and safety. Along with most of the world, Canada is facing serious health, social and economic challenges due to COVID-19. The federal government, its public health agency, Agriculture and Agri-Food Canada and Canada’s public servants have risen to the challenge. While there is more work to be done, Canada is emerging as a global leader in supporting both its citizens and businesses, which is where we want our country to be during this crisis.

Our government has done this with a degree of collaboration with provinces and territories that is undoubtedly without precedent. The same is true of the degree of consultation with economic sectors, and I have no doubt that that is inclusive of our agricultural sectors.

I will conclude by thanking Senator Robert Black for his sponsorship of this bill and for his energetic leadership on agricultural issues. I also want to thank farmers and agri-food workers, whose tireless efforts in keeping our food supply chain up and running is appreciated by all Canadians from coast to coast to coast. I encourage honourable senators to join me in voting in favour of this legislation. Our dairy sector and all Canadians are counting on us at this unprecedented time.

The Hon. the Speaker

Is it your pleasure, honourable senators, to adopt the motion?

Hon. Senators: Agreed.

(Motion agreed to and bill read third time and passed.)